Chicago: Navigant reported solid 2011 unaudited financial results last week and gave a positive outlook for 2012.
Pre-tax profits in the quarter to December 31 were $18.3 million, up from $3 million in the same quarter last year. Revenues in the quarter were up 8% to $197 million.
Full year pre-tax profits were up 72% to $70.7 million on revenues up 11% to $784 million.
William Goodyear, Chairman and CEO, said, "Our 2012 plans call for solid, primarily organic, growth in top line revenues with continued focus on profit improvement. Once again, we anticipate significant free cash flow that will be used primarily to invest internally, to further deleverage our balance sheet and to continue to repurchase shares."
"We are pleased to report strong fourth quarter results, capping our solid performance throughout the year. Our professionals continue to deliver outstanding service to our clients, and our actions taken and investments made over the past two years are now more fully reflected in our improved financial results. These efforts drove strong cash flow generation in 2011 and provide us with significant financial flexibility to continue to grow our business and to deliver value to shareholders."
Business Segment Highlights
Navigant's Business Consulting Services segment reported revenues before reimbursements, RBR, of $75 million in fourth quarter 2011, up 10% from fourth quarter 2010 while down 7% from third quarter 2011. Year over year improvements were led by strength in the Energy and Healthcare practices, and reflected strong contributions from the Valuations and Restructuring teams. Navigant's Healthcare practice continues to assist healthcare systems, physician networks and payer organizations with healthcare reform and other industry pressures including managed care pricing, healthcare exchanges, performance improvement initiatives and industry consolidation. Demand continues for the firm's Energy services on engagements related to renewables, Smart Grid technologies and energy efficiency programs. The Healthcare and Energy practices comprised a combined 73% of segment revenues in fourth quarter 2011. Segment operating profit increased to 36% of RBR in fourth quarter 2011, up from 33% in fourth quarter 2010 and 32% in third quarter 2011. Average billable FTEs were 992 in fourth quarter 2011, up from 833 in fourth quarter 2010 and 938 in third quarter 2011.
The company's Dispute and Investigative Services segment generated RBR of $66 million in fourth quarter 2011, up 3% from fourth quarter 2010 while down 2% from third quarter 2011. Segment operating profit was 40% of RBR in fourth quarter 2011, up from 37% in fourth quarter 2010 and down from 42% in third quarter 2011. 2011 staffing comparisons were impacted by reductions made within the Construction practice in late 2009 and throughout 2010. Consequently, average billable FTEs declined to 600 in fourth quarter 2011 from 616 in fourth quarter 2010, while up slightly from 594 in third quarter 2011. 2011 segment revenue growth was broad based and was driven by success on credit crisis related matters, anti-money laundering compliance and investigations, and international arbitration, as well as growing contributions from the Company's Technology Services practice area.
Navigant's Economic Consulting segment reported RBR of $14 million in fourth quarter 2011, down 19% from fourth quarter 2010 and 20% from third quarter 2011. Despite lower revenues, fourth quarter 2011 segment operating profit improved to 34% of RBR, up from 29% in fourth quarter 2010 and 33% in third quarter 2011. Average billable FTEs were 117 in fourth quarter 2011, down from 133 in fourth quarter 2010 and 118 in third quarter 2011.
The company's International Consulting segment achieved RBR of $16 million in fourth quarter 2011, up 29% from fourth quarter 2010 while down 4% from third quarter 2011. Improved 2011 results represented significant progress in the turnaround of the Company's international business over the course of the year. Additionally, market demand has increased for Navigant's expertise in construction disputes matters. Segment operating profit was 26% of RBR in fourth quarter 2011, which doubled from 13% in fourth quarter 2010 and was also up sequentially from 18% in third quarter 2011. Average billable FTEs were 180 in fourth quarter 2011, up from 173 in fourth quarter 2010 and down from 188 in third quarter 2011.
Full year 2012 RBR is expected to range between $710 and $770 million while total 2012 revenues are estimated to be between $800 and $860 million.